Tipping is on its way to extinction says U of G professor

GUELPH, Ont. — Tipping will likely disappear from Canada’s hospitality landscape in the next 10 to 20 years, according to Michael von Massow, a professor at the University of Guelph’s Department of Food, Agriculture and Resource Economics.

“I think there will be consumers who resist it. I think there will be some consumers who are relieved,” von Massow said. “The last thing they do in a restaurant won’t be deciding how much to tip and feeling guilty they didn’t tip enough.”

Von Massow’s conclusion on tipping was formed after partnering with professor Bruce McAdams, from the university’s Department of Hospitality, Food and Tourism Management, to study how tipping affects a restaurant’s operations.

“There were a number of issues that made us think tipping was going to be in the forefront,” von Massow said.

“You can’t get a group of restaurateurs in a room and not have tipping come up at some point.”

The study included interviews with about 50 restaurant managers and 50 restaurant servers as well as 160 online surveys completed by front of house staff. Their research questioned restaurant staff from across Canada, with about 50 per cent of respondents from Ontario.

Their research found restaurants would benefit from reforming their practices surrounding gratuities.

“Overall it becomes a difficult thing to manage in a restaurant,” von Massow said. “It has the potential to create tension and inconsistent service experiences.”

They discovered tipping creates wage disparity between the front and back of house resulting in personnel problems for management. More than half of the servers questioned reported making $15 to $20 in tips on top of their hourly wage.

“If you consider not all of that is taxed, they’re doing fairly well,” von Massow said. “People in the kitchen are making a little more than minimum wage, but not much more.”

Service quality is also affected by tipping. Despite the common notion that a better tip equals better service, von Massow said there is no correlation between quality of service and size of gratuity as customers generally tip regardless of performance.  

“However, there is a strong coalition between perceived tip and quality of service,” he said.

Servers, in some instances, will predict whether or not the customer will tip well, leading to varying levels of performance by the employee.

“If they perceive that person to be a big tipper, they will provide outstanding service. If they perceive the person to not tip well, they get worse service,” he said.

“If I’m a restaurant operator, that’s an issue for me. The tip might be identical in both circumstances.”

The server’s perception may be based on a number of factors, including gender, age, race and party size.

“As a customer, that’s not good. As a restaurant owner, that’s not good either,” von Massow said.

Tipping also has the ability to stall succession planning and career development within a restaurant. Staff may not look for promotions, as a manager’s wage is typically less than a server’s wage, when tips are factored into the amount.

“They get a technical raise from the restaurant, but because they’re no longer tipped, the overall pay goes down,” Von Massow said.

The move away from tipping is already underway, von Massow explained. In Calgary, A downtown Earls location removed tipping in favour of a mandatory 16 per cent gratuity fee. In New York, Union Square Hospitality Group has eliminated tipping and raised prices on their menus.

“I think we’re seeing the thin edge of the wedge now,” von Massow said. “Some people are doing it and struggling, others are doing it and succeeding.”

Comments

2 comments

lea ortner

my husband and I own a small independent restaurant on Vancouver Island. We are in the fast casual segment so we do not have servers. Orders are placed at the cashier, the customers name is taken with the order and the customers are either called up to get their order when its super busy or we take the order out the customer when we can. even though we have no servers, we have created an excellent customer service culture in our restaurant and most of our customers leave a tip of some kind. all of our tips are pooled, as owners we do not take any of the tips, but rather pay it all back to the team based on the number of hours worked per pay period. this supplements every employees wage by a minimum of $5.00 an hour and allows all of our employees from the pot washer to the cashier, and our cooks to make a decent living. this is such a simple, and fair way to deal with tips and it benefits everyone involved. Its not rocket science but I've never heard of any other restaurants doing this. Regarding the article - the researchers talked to front of the house employees only - what about the cooks? why don't they count? a restaurant operates as a team with every position contributing to its success and therefore every employee should share equally in a job well done. You know, IMO you could take most cooks out of the kitchen, dress them up, give them a hair cut and they would survive and event thrive in the front of the house. they already know how to prioritize, multi task, stay organized and handle incredible amounts of stress. The reverse is absolutely not true as most servers would be in tears within 30 minutes of being placed in a busy restaurant kitchen. so why do the cooks always get shafted? I love our system it works extremely well and all of our staff are rewarded equally and financially for a job well done. Its a team folks!!

Virgilio Sobral

Tipping should not be regulated by any group nor by the industry.The consumer should decide how much to give based on the quality of the service they receive. I will stop going to restaurants for a casual meal. we have so many options today , that there is no need to go out to a restaurant for supper except on very special occasions. a lot of serving personal are making much more money than executive chefs . Add Tipping, PST, GST, and a bottle of wine, is half of someone`s bill. I think imposing a gratuity fee, will deter a lot of people away from restaurants, and i will be one of them